The Apple iPad was announced official on January 27, 2010, and was released on April 2010. Its price is determined mainly by both demand & supply of iPads.
Firstly, the iPad has attractive functions that consumers would enjoy. It can not only access to the internet, games can also be downloaded to play, substituting traditional laptops that people have been using for years. In addition, working people can have easy access to daily news and book reading via the newest ‘shiny new iBooks application’ (which attracted 37% of survey respondents), making iPad more applicable in their working lives. These features of the iPad affect the taste of the consumers which affects their decision to purchase the iPad. Hence demands are affected.
Apple’s Iphone and Itouch are associated with the Ipad. The iphone had its origins in a rough prototype for the iPad. Being under the same company, they have similar functions, eg. Touch screen, O.S, applications. These products are similar to the iPad but vary in terms of size. As the iPad is much bigger in size, consumers may turn to iPhones and iTouch as substitutes when it comes to taste as they are smaller and convenient. Moreover, other brands in the market acts as substitutes for the iPad with similar functions and size, for example: Samsung Galaxy Tab, which comes at a lower price, thus affecting the choice of consumers to choose the Samsung galaxy tab, the cheaper alternative, over the iPad. Thus the demand of iPad would decrease.
para 2: What are these details meant to bring across? What is the purpose of quoting all these from the sources?
Para 3: How does opportunity cost affect the price of iPad? MISCONCEPTION HERE Price of iPad is determined differently.
Para 4: So how are these products related to iPad in economic terms? are these the only associated products?
Economics project B:
Recent developments in the technology industry can affect the marketing and pricing of ipads in different ways.
Firstly would be the upcoming release of ipad 2, resulting in the change of taste of consumers. Ipad 2 will be installed with more functions, hence making it more attractive to buyers. This would lead to the decrease of ipad’s demand as an increasing number of people would choose to buy the more advanced ipad 2 despite it being more expensive than the ipad. Due to this, producers would lower the cost of the iPad and produce less iPad, decreasing its supply, as demand for the iPad has now decreased.
Secondly would be the price of substitutes. Substitute products are alternative products that satisfy the same wants or needs. An example of substitute of ipad would be the recent ‘Samsung Galaxy Tab’. The Samsung Galaxy Tab is an Android-based compact tablet computer which has the same functions as the ipad. Some people might choose to buy the Samsung Galaxy Tab instead of the ipad as it is offered at a lower price, but has similar functions as an iPad, serving the similar needs of the people. Even though the price of ipad remains the same, its demand decreases as there is a cheaper alternative present, hence affecting the market of ipads. Producers would then lower the price of iPads to keep it in competition with the substitutes which are cheaper. By lowering the price, quantity demanded would increase.
Thirdly, the recent disaster in Japan has affected the production of ipad components in Japan. The touch screen of the ipad requires Japan’s Epson Company to supply for the liquid - crystal display, which would decrease due to the presence of natural disaster. This decreased supply of the liquid-crystal display then leads to the increase in price of the display, causing there to be an increased production cost per unit of ipads. Ultimately, the supply of ipads would decrease as higher production cost is incurred. Hence, the price of ipads would increase. However, producers may turn to other suppliers for the liquid- crystal display other than Japan’s Epson Company, thus price of the iPad would not increase.
Lastly, government legislation has impacted the pricing and marketing of ipads, especially in China. Recent research showed that Apple’s iPad has received a safety certification mark from the Chinese regulators, which means ipad is now allowed in China. This benefits the producers as it has a bigger market in the future. This then increases the demand of ipads as it has now a bigger market to be sold in. Though the price of ipads remains the same, the demand increases, hence the producers would increase their supply, increasing their profits.
Para 2: Analysis is okay. So looking at the market now, what would the producers do in terms of marketing and pricing decision?
Para 3: Ananlysis lacks rigour. Why would consumers switch to Samsung Galaxy Tab? So, what is the impact on the market of iPad-price and quantity of iPad? What would the producers do then in response to the change in price and quantity of iPad in terms of marketing and pricing strategy to achieve its objectives? Para 4: analysis is okay. Is there anything that the producers can do to improve its situation in the market for iPad? Para 5: Demand would increase not because of popularity but because of something else. What happen to price and what happen to supply? Main concern: Lacking in pricing and marketing strategy. Analysis are relatively okay but i hope that you are able to link them and explain with reference to a diagram.
The Apple iPad was announced official on January 27, 2010, and was released on April 2010. Its price is determined mainly by both demand & supply of iPads.
Firstly, the iPad has attractive functions that consumers would enjoy. It can not only access to the internet, games can also be downloaded to play, substituting traditional laptops that people have been using for years. In addition, working people can have easy access to daily news and book reading via the newest ‘shiny new iBooks application’ (which attracted 37% of survey respondents), making iPad more applicable in their working lives. These features of the iPad affect the taste of the consumers which affects their decision to purchase the iPad. Hence demands are affected.
Apple’s Iphone and Itouch are associated with the Ipad. The iphone had its origins in a rough prototype for the iPad. Being under the same company, they have similar functions, eg. Touch screen, O.S, applications. These products are similar to the iPad but vary in terms of size. As the iPad is much bigger in size, consumers may turn to iPhones and iTouch as substitutes when it comes to taste as they are smaller and convenient. Moreover, other brands in the market acts as substitutes for the iPad with similar functions and size, for example: Samsung Galaxy Tab, which comes at a lower price, thus affecting the choice of consumers to choose the Samsung galaxy tab, the cheaper alternative, over the iPad. Thus the demand of iPad would decrease.
Para 3: How does opportunity cost affect the price of iPad? MISCONCEPTION HERE
Price of iPad is determined differently.
Para 4: So how are these products related to iPad in economic terms? are these the only associated products?
Recent developments in the technology industry can affect the marketing and pricing of ipads in different ways.
Firstly would be the upcoming release of ipad 2, resulting in the change of taste of consumers. Ipad 2 will be installed with more functions, hence making it more attractive to buyers. This would lead to the decrease of ipad’s demand as an increasing number of people would choose to buy the more advanced ipad 2 despite it being more expensive than the ipad. Due to this, producers would lower the cost of the iPad and produce less iPad, decreasing its supply, as demand for the iPad has now decreased.
Secondly would be the price of substitutes. Substitute products are alternative products that satisfy the same wants or needs. An example of substitute of ipad would be the recent ‘Samsung Galaxy Tab’. The Samsung Galaxy Tab is an Android-based compact tablet computer which has the same functions as the ipad. Some people might choose to buy the Samsung Galaxy Tab instead of the ipad as it is offered at a lower price, but has similar functions as an iPad, serving the similar needs of the people. Even though the price of ipad remains the same, its demand decreases as there is a cheaper alternative present, hence affecting the market of ipads. Producers would then lower the price of iPads to keep it in competition with the substitutes which are cheaper. By lowering the price, quantity demanded would increase.
Thirdly, the recent disaster in Japan has affected the production of ipad components in Japan. The touch screen of the ipad requires Japan’s Epson Company to supply for the liquid - crystal display, which would decrease due to the presence of natural disaster. This decreased supply of the liquid-crystal display then leads to the increase in price of the display, causing there to be an increased production cost per unit of ipads. Ultimately, the supply of ipads would decrease as higher production cost is incurred. Hence, the price of ipads would increase. However, producers may turn to other suppliers for the liquid- crystal display other than Japan’s Epson Company, thus price of the iPad would not increase.
Lastly, government legislation has impacted the pricing and marketing of ipads, especially in China. Recent research showed that Apple’s iPad has received a safety certification mark from the Chinese regulators, which means ipad is now allowed in China. This benefits the producers as it has a bigger market in the future. This then increases the demand of ipads as it has now a bigger market to be sold in. Though the price of ipads remains the same, the demand increases, hence the producers would increase their supply, increasing their profits.
Para 3: Ananlysis lacks rigour. Why would consumers switch to Samsung Galaxy Tab? So, what is the impact on the market of iPad-price and quantity of iPad? What would the producers do then in response to the change in price and quantity of iPad in terms of marketing and pricing strategy to achieve its objectives?
Para 4: analysis is okay. Is there anything that the producers can do to improve its situation in the market for iPad?
Para 5: Demand would increase not because of popularity but because of something else. What happen to price and what happen to supply?
Main concern: Lacking in pricing and marketing strategy. Analysis are relatively okay but i hope that you are able to link them and explain with reference to a diagram.
Resources:
http://www.businessweek.com/technology/content/apr2010/tc2010046_788280.htm
http://www.macworld.com/article/153145/2010/08/ipad_china.html
http://galaxytab.samsungmobile.com/
http://www.apple.com/ipad/features/
Group Members:
Sharon Long
Xueting
Jolene
Jiaxin
Ivan
Junwen